Kansas bets the farm on Court decision

Wednesday

Jun 27, 2012 at 4:26 PM

John Hanna

Kansas officials have made little progress toward enacting a key part of the federal health care overhaul, and Gov. Sam Brownback and fellow Republican critics of the law are instead hoping that the U.S. Supreme Court will strike it down, saving them the trouble.

If the nation’s highest court does that in its ruling, which is expected Thursday, many Kansas officials are likely to celebrate. But if the justices uphold even part of the law, the state could find itself with a new health insurance exchange over which it has little control.

Republican hostility against the 2010 law championed by President Barack Obama prevented the state from establishing its own exchange, which would help consumers find health insurance starting in 2014. Last year, Brownback returned a $31.5 million federal grant to assist the state with the computer infrastructure for an exchange.

If the requirement for exchanges stands, states face a Nov. 16 deadline to submit plans to the U.S. Department of Health and Human Services. The choices for Kansas would be seeking a partnership with the federal government or having the federal government run the exchange, said Linda Sheppard, the Insurance Department’s project manager for the health overhaul.

"I do not believe we’d be able to do a state-level exchange," said Sheppard, also director of the department’s accident and health division.

Some industry officials worry about having a federally run exchange for Kansas, fearing its rules could be too burdensome and that some requirements could cut independent agents out of the exchange completely. Kerri Spielman, executive director of the Kansas Association of Insurance Agents, still holds out hope that legislators could work on an exchange next year.

"There are just too many people ready to move and act," she said. "We don’t need to reinvent the wheel. We just need to have something that fits Kansas."

Republican legislators defend their lack of action, saying it made no sense to work on an exchange with so much uncertainty surrounding the federal law.

But House Insurance Committee Chairman Clark Shultz, a Lindsborg Republican acknowledged, "If it stands, we’re definitely running into a time deadline here — a crunch."

Kansas has about 350,000 residents who don’t have health insurance coverage, or 12.7 percent of the state’s population, according to U.S. Census Bureau figures. About 53,000 are children.

Insurance Commissioner Sandy Praeger, a Republican, had planned to work on an exchange, but the Kansas GOP made the 2010 elections largely a referendum on Obama and tapped into the tea party movement’s frustrations. Republicans swept all statewide and congressional offices for the first time since 1964 and added to their legislative majorities, and many new lawmakers are conservatives.

"They think they are going to be vindicated," said state Democratic Chairwoman Joan Wagnon, a former Kansas House member. "They’ve put all of their eggs in that basket."

Brownback was a U.S. senator and an ardent opponent of the health care overhaul before he became governor in January 2011. His office was not saying before the U.S. Supreme Court’s ruling how it might respond to various possibilities.

Last year, Brownback not only returned the federal grant but also signed a "health care freedom" bill into law. The law says Kansas residents have the right to refuse to buy health insurance, adding that they can’t be fined or forced to pay other penalties for refusing.

The law takes aim a provision in the federal health care overhaul requiring most Americans to purchase health insurance, starting in 2014, and imposing tax penalties if they don’t. Even some GOP legislators doubted the state law could block the mandate in Kansas, but supporters saw it at least as a powerful statement.

Brownback’s administration also has criticized a provision of the federal health care overhaul that expands the Medicaid program, so that states cover childless adults. Republicans are skeptical that the federal government will keep its promises to finance the expansion, and state officials estimate it would add as many as 130,000 people to the state’s Medicaid program.

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